Page 4. Demise of the car-assembly and component industries

Assembly plant closures

New Zealand’s car assembly industry grew largely as a result of protectionism – tariffs and import licensing that discouraged imports of assembled cars. By the 1980s the government realised that it was cheaper and more efficient for cars to be assembled in the country where they were made.

In the late 1980s the government’s Motor Industry Development Plan reduced tariffs on imported vehicles, which were then able to compete with domestically assembled cars. Australian cars were already duty-free under the Closer Economic Relations agreement. This, and a growing flood of second-hand Japanese imports, led to the demise of local assembly by the end of the 1990s.

General Motors closed its Petone plant in 1984, and its Trentham plant in 1990. It had assembled nearly 600,000 vehicles in New Zealand. In 1994 it changed its name to Holden New Zealand, to focus on the sale of its main brand. All of its cars were imported assembled from Australia.

Todd Motors’ Porirua plant was sold to Mitsubishi in 1987, the last of the assemblers to be taken over by the parent company. With continuous efficiency improvements, it lasted another 11 years before closing.

In 1997 Ford and Mazda stopped assembling cars in Auckland, and in 1998 so did the other three remaining producers: Toyota, Nissan and Honda. That year, all remaining tariffs on imported cars were removed.

On driving in the 1960s

‘If we could afford a car, it would be either tiny (think Morris Minors and Fiat Bambinas) or really big and bulky with masses of chrome (think Chevrolet Bel Airs and the Vauxhall Velox). We drove on narrow, winding and often unsealed roads with no safety belts, no safety glass, poor brakes and lousy handling.’1

Component industries

The motor assembly industry relied on a wide range of local component manufacturers and suppliers. These had developed since the 1930s, when industry was encouraged with tariff protection, and later with local content requirements for cars imported unassembled. Component manufacturers included Exide batteries, Dulux paints, Tubular Steel exhaust systems, and makers of bumpers, upholstery, rubber components and tyres. In the 1990s such companies were also affected by the reduction in tariffs on imported vehicles.

Jobs were lost in South Auckland and Masterton when automotive-wiring manufacturers closed in the late 1990s. Pilkington Automotive in the Hutt Valley had supplied glass to all New Zealand car assemblers but, despite moving into export markets, it closed in 2003. Radiola Corporation lost its car radio business, because imported cars arrived with radios.

Companies that had been geared towards export were less affected. One such company was Southward Engineering, which made exhaust systems for Australia. Another was Firestone, which built a plant in Christchurch after the Second World War. In the early 2000s it still manufactured tyres for the domestic market, and exported to Australia and the Pacific.